Brand endorsers will pay a penalty of as much as Rs 50 lakh in the event that they sell a misleading commercial, in step with the Consumer Protection Bill surpassed with the aid of Parliament.
The new invoice, which repeals the prevailing Consumer Protection Act, provides for the establishment of a vital consumer safety authority as an apex frame to shield the rights of purchasers, intervene in instances of unfair exchange practices and initiate class action. The authority can put into effect the remember refund and return of merchandise. The invoice, cleared via the Lok Sabha closing week, changed into exceeded by the Rajya Sabha on Tuesday.
For the primary time, the bill has a provision to deal with misleading advertisements. The law will cowl commercials which falsely describe services or products or provide a false guarantee or is possibly to misinform clients on the character, substance, quantity or first-rate and deliberately hide important data.
The earlier act did no longer have any particular provision on deceptive classified ads.
If the customer safety authority, in order to have investigation powers, finds any commercial false or deceptive, it could order the dealer or producer or endorser or advertiser or writer to stop or to modify it.
If the CCPA feels the necessity, it can impose at the producer or the endorser a penalty which can also amplify to Rs 10 lakh. For each next contravention by means of the manufacturer or the endorser, it may impose a penalty that may expand to Rs 50 lakh.
The bill says that no endorser shall be at risk of pay the penalty if he or she has exercised due diligence to affirm the veracity of the claims made inside the commercial.
Suresh Misra, a professor of client affairs at the Indian Institute of Public Administration (IIPA), Delhi, said the provision on deceptive advertisement could function a deterrent.
“A lot of human beings are stimulated via the endorsement of commercials by means of celebrities. Now the endorsers ought to be accountable. The provision of penalty will serve as a deterrent,” Misra said.
Any producer or provider issuer in the back of a false commercial may be imprisoned up to two years and fined as much as Rs 10 lakh. Every next offense can entice jail up to five years and a most high-quality of Rs 50 lakh.
The invoice says lawsuits on unfair exchange practices may be forwarded to the collector or the commissioner of the nearby workplace or the primary authority.
If a probe by using the purchaser protection authority establishes wrongdoing, it is able to order a don’t forget, repayment and discontinuation of the exercise.